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Sunday, 11 March 2018

ICO Review: CloudMoolah

Democratizing the
gaming industry by unlocking global game payments and distribution.

What’s the problem
CloudMoolah is trying to solve?

Game developers currently pay a hefty
amount in distribution and marketing fees to incumbent app stores (eg. Apple
App Store, Google Play). Furthermore, more than 50% of total mobile game
revenue is currently earned by less than 2% of all app developers, particularly
those with big advertising budgets.

SEA is the world's fastest-growing
mobile gaming market (69% y-o-y growth), but is currently fragmented,
consisting of 11 countries with a fragmented payment landscape and low credit
card penetration.

Game developers currently need to
undergo lengthy and cumbersome integration processes to publish their apps in
various app stores. Most in-app purchases currently utilize credit cards for
processing, but not every gamer owns a credit card.

Within the Southeast Asia market,
credit card penetration is still under 3%, so there is a need for gaming
payments to be integrated with telco top-up cards, pre-paid cards, e-banking,
or through other current localized modes of payment.

The existing solution is to integrate
with multiple Software Development Kits (SDKs) with local payment companies, a
process which takes months to complete as developers have to undergo
negotiation and integration testing process with different vendors for the
different markets.

The Solution

Utilize blockchain technology to
faciliate gaming payments, which will help developers save on intermediary
costs (such as retail margins and currency conversion fees). CloudMoolah will
be a payment aggregator integrated within the Unity game development software.

What used to be months of payment
integration across different country markets can now be completed in 10
minutes, and within a single CloudMoolah integration through the Unity Editor,
game developers can now access more than 100 million gamers in Southeast Asia
from over 500,000 retail point of sales.

As of October 2017, the CloudMoolah
payment aggregator has been launched and successfully integrated into the Unity
Editor. It is currently available alongside global titans such as Apple, Google
Play, Amazon, Facebook, Xiaomi and Samsung:

I was also able to verify this directly from a Unity source here, where you can find proof in their manual for game
developers on how to configure and integrate with CloudMoolah for in-app
payments.

Over 300 game developers have already
expressed an interest in integrating the CloudMoolah payment system and are
currently in process of onboarding to the system.

In the next phase, Cloud Alliance, the
team behind CloudMoolah aims to “build the best 3rd party Android
App Store” i.e. the MOO Store, which will simplify the mobile app publishing
process as it allows developers to directly publish their games from the Unity
platform. The MOO Store will also offer value-added publishing services for
game developers such as content localization.

Transactions on the MOO Store will be facilitated
by CloudMoolah Points (CMP), which can either be purchased with fiat currency
at USD 0.01 per CMP or using the MOO Tokens (at 20% bonus).

With a unified in-app currency, game
developers do away with forex conversion costs and the hassle of managing
currencies for different games. Game developers can easily consolidate revenues
from their various games — providing operational efficiency and transferability
of game economics, hence incentivising them to use and integrate this form of
payment gateway into their games.

You can think of it as the “Mobile
gaming Steam Store for Southeast Asia, with an in-built Kickstarter for game
developers and virtual items marketplace”. (taken
from their Telegram)

How does this compare
with other payment competitors?

CloudMoolah is currently the only
company offering an aggregated localized payment solution directly within the
Unity editor. Instead of competing, they work alongside local payment
incumbents and game developers.

Partnerships

To achieve their mission in
democratizing game publishing and monetisation, Cloud Alliance has partnered
with Unity Technologies, which many independent game developers swear by.

Unity Editor is the world's largest
video game development engine used by over 5.5 million developers today. The
development of multimillion-dollar games such as Pokemon Go, Super Mario
Brothers and Assassin's Creed were supported by Unity. The Unity development
platform is used to create 2D, 3D, VR and AR gaming experiences.

CloudMoolah is currently Unity’s
exclusive partner in Southeast Asia. In addition, they have partnerships with
the following major payment partners in SEA and Taiwan:

How impressive is the
team behind CloudMoolah?

The founding team has experience and a proven
track record in the gaming industry, particularly in publishing popular games
such as FIFA Online 2, World of Warcraft, Counterstrike Online, Starcraft 2,
etc.

What’s the value of
the MOO Token?

Gamers who have purchased the MOO Token
will be able to exchange their MOO Token for more CMP in the MOO Store than if
they were using fiat currency. Gamers can also support the games they love
using the MOO Token through crowdfunding as well as trading of services and
items on the MOO Store.

For developers, use cases of the MOO
Token include: (i) Paying for game publishing services to grow their games;
(ii) Receiving incubation support from Cloud Alliance; (iii) Obtaining support
through crowdfunding and (iv) Trading various services and items on the MOO
Store.

My Q&A with the
team

1.
CloudMoolah previously raised USD 5 million from Aetius Capital, of which the
funds was supposed to be used to develop the product and market it worldwide.
Why raise $30 million more through an ICO? Or have you already run out of the
original $5M funding?

The original $5m was primarily used to develop
the CloudMoolah system which we have already integrated within the Unity Editor
and launched. Because of the success of the CloudMoolah project, we signed a
new deal with Unity to develop an App Store called the MOO store. This is a
much bigger project which requires more resources. We realise that raising the
funds via an ICO would therefore make the most sense because it also draws in
the community into supporting the project, which is crucial as we are ultimately
about engaging the game community.

2. Given
that many members on your current team have other existing commitments outside
of CloudMoolah, how will your team intend to balance this out?

Of course most active and energetic people would
have other interests in life outside of their core work, likewise for our team
members. But our key work commitment now is CloudMoolah & MOO store. Rest
assured we are expending all our efforts and time on making it a success.

3. Focusing
on the Asian market first will eliminate a large majority of gamers who are
based in US and Europe. Wouldn't this limit your sales and returns?

Our business model is about improving
monetization from emerging markets. We technically bridge content from advanced
game-manufacturing markets such as US/Europe/Korea to SE Asia markets. Next up,
we would be looking at including new payment gateways from other emerging
markets as well. If you look at the SEA online gaming market alone, it is
potentially a $10b market by 2025, and staying focused on this market alone can
reap huge rewards.

4.
"More than 100 million gamers...in Southeast Asia and Taiwan" was
mentioned in your whitepaper as your target market, as well as a revenue
projection of "the MOO store may generate revenues of USD 295 million by
the year 2022". Can you explain if these statistics covers all gamers in
SEA, or whether it excludes gamers who use iPhones?

SE Asia markets are about half the size of China
and with a red-hot growth rate of +40% as a whole. Our projections cover SE
Asia alone and only on the Android users (which is also gaining market share
aggressively).

5. Games
downloaded from the Apple App Store will have to be paid through Apple as well.
Given that many gamers also download apps from the Apple App store, how do you
intend to overcome the issue of not being able to target these consumers?

Our current focus is on emerging markets
where there are pent-up demand for games that is hindered by access to the centralized
financial system. Android-based smartphones dominates these market – in
Southeast Asia alone, Android market share (by game installation) is close to
90% - that is why we decided to target this market first.

Just the Android market itself is already a
sizable potential. Also, our target audience are the non-credit card users in
emerging markets, which are largely served by Android-based smartphones.

6. Adding
on to the above, how will the games be distributed then? How will the game
developers market and promote their games?

Our MOO Store! And we intend to put in tools to
help them market and promote their games "kick-starter-style." Having
met hundreds of Unity developers in the past year, we discovered that they are
their own best person to sell their game.

7. How
many % of market share are you targeting for CloudMoolah, especially given that
you're competing against already established payment channels of Amazon, Google
Play, Samsung Galaxy and Xiaomi?

We would prefer to see ourselves as a complement
to what these established companies are providing. Realising untapped revenue
for indie game developers means survivability and motivation (a great deal).

8.
Regarding your whitepaper and Appendix A, how many of the 300 developers
mentioned have committed to building and integrating with CloudMoolah store for
payments? Will this be exclusive, or will they be integrating CloudMoolah
simply as an additional payment method on top of Google Play / other
competitors?

100% of them. Every developer we spoke to at the
game conferences loves what we are doing. We are giving them access to a market
opportunity they would most likely miss (outside of their comfort zone
markets). We help them save time and effort. We help them pay their bills. In
short, we help them get the "Moolah"!

TLDR
Conclusion

After successfully launching their
payment aggregator solution for Southeast Asia, Cloud Alliance is trying to
raise USD 30 million through their ICO to now finance and develop the MOO
Store, which will serve to democratize the gaming industry. Their exclusive
partnership with Unity, as well as with local payment providers in SEA, will
serve them well.

After an in-depth review, I’ll be
putting some ETH into this ICO, and am excited to see what the team can achieve
with the MOO Store!

If you’ve any thoughts to add on, I’ll
love to hear them in the comments below!

What's your mortgage like?

Hello!

You can call me Dawn, and this little space on the Internet is where I write about becoming financially-free. Join me as we learn more about savings, budgeting, paying off debts, insurance and investing together!

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Please note that all statements published on this blog are solely opinions of my own i.e. of a personal nature, and should not in any way be taken as statements of fact. Readers are encouraged to do their own research before arriving at any conclusions based solely on materials provided, or republished, on this blog.